- Verizon Communications Inc. (VZ) anticipates “soft” first-quarter subscriber growth and a slow start to phone upgrades in 2025 due to intensified competition from rivals’ promotions and consumer caution amid U.S. economic concerns, causing its shares to drop on Tuesday.
- Despite early challenges, the company expects to exceed its 2024 addition of approximately 900,000 monthly-bill-paying wireless subscribers in 2025, leveraging its customizable myPlan and building on a strong Q4 driven by bundled 5G and streaming services.
Verizon Communications Inc. (VZ) shares fell nearly 7% to $43.20 in early trading on Tuesday after the company signaled a tough start to the year. Speaking at Deutsche Bank’s Media, Internet & Telecom Conference, Chief Revenue Officer Frank Boulben cited heightened competition, according to Reuters. Rival carriers have ramped up promotions to lure customers, a strategy Verizon dialed back after a promotion-heavy December quarter, leading to expectations of “soft” subscriber growth in the first quarter. This competitive pressure comes as the American telecom market, nearing saturation, sees firms leaning heavily on incentives to maintain momentum, a tactic that has fueled subscriber gains but sparked concerns over profitability across the industry. Boulben also noted a “slow start” to phone upgrades this quarter, reflecting consumer caution amid rising economic uncertainties in the U.S., a trend that could further strain revenue streams tied to device sales.
Despite these headwinds, Verizon remains optimistic about its full-year outlook, projecting more monthly-bill-paying wireless subscribers in 2025 than the approximately 900,000 added in 2024, driven by the flexibility of its customizable myPlan offering. This confidence builds on a robust fourth quarter for U.S. telecoms, where Verizon and its peers capitalized on bundled plans combining 5G services, high-speed fiber data, and streaming perks to attract customers. The company’s ability to adapt its pricing and service options will be critical as it navigates a market where customer acquisition costs are rising and economic conditions may temper spending. Verizon’s experience mirrors broader industry dynamics, with 5G rollout largely complete, shifting the focus from infrastructure expansion to retaining and growing a cost-conscious customer base in an increasingly crowded field.
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